THE IMPACT OF REDISTRIBUTION ON INEQUALITIES AND ECONOMIC GROWTH

Nerau Vlad
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Nerau Vlad: THE BUCHAREST UNIVERSITY OF ECONOMIC STUDIES

Annals - Economy Series, 2015, vol. 6Special, 443-451

Abstract: The article analyses the impact of inequalities and redistribution on economic growth. The analysis starts from testing the European Union on accomplishing the dual objective of economic growth and social equity. In order to test this hypothesis, I proposed a model which correlates the three variables above mentioned with foreign investments per capita. The model contradicts a vision of previous research, which considers that redistribution negatively affects economic growth and proves that a sustainable economic growth can be obtained by reducing inequalities. In addition to empirical evidence, the article analyses the social impact of inequalities. They do not only affect economic growth (stricto sensu) but also the development of society (lato sensu), by causing a series of desequilibriums which undermine social consensus. The social consensus is greatly needed to adjust to major shocks EU confronts with nowadays.

Keywords: Panel Cointegration; Redistribution; Inequalities and Economic Growth (search for similar items in EconPapers)
Date: 2015
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Persistent link: https://EconPapers.repec.org/RePEc:cbu:jrnlec:y:2015:v:6special:p:443-451

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